Buying local: State’s efforts are mixed blessing for wine industry

Pete Pizzadili stands next to a rack with hundreds of bottles at his winery. Special to the Delaware State News/Gary Emeigh

Although Delaware’s wine making tradition is still fairly young, its roots are deepening.

The state’s two longest running wineries Nassau Valley Vineyards (founded in 1987) in Lewes and Pizzadili Winery (opened in 1993) in Felton have both continued to grow while new arrivals like Salted Vines Vineyard & Winery in Frankford have spent the past few years getting established.

The industry has broadened as well, with both meaderies and cideries opening their doors. Harvest Ridge Winery added its Rebel Seed Cidery in 2013, and the newest addition to the state, The Brimming Horn Meadery, opened its doors last July.

According to Pete Pizzadili demand is growing for event space and tourist destinations in addition to the wine itself.

“We’re now producing around 3,000 gallons of wine per year and we do an average of one wedding per week from April through the end of October,” he said.

Pete Pizzadili holding one of the varieties of wine he makes at his winery near Felton.

Residents’ growing commitment to buying local products is also helpful, notes Chuck Nunan from Harvest Ridge Winery in Marydel.

“Delaware consumers buy Delaware products. It’s easily one of the biggest strengths of this location,” he said. “This is a great state to do business in.”

Two recent legislative development in the state will likely both help and hinder the growth of the industry, say wine makers. The signing of House Bill 373 last month — a law that permits licensed Delaware craft distilleries, breweries and wineries to sell one another’s products for on-site consumption — will allow wineries to expand their offering, possibly making their sites more attractive as event space.

But, the recent defeat of House Bill 165 on June 30, which would have allowed wineries in the state to directly ship their products to consumers in the state, has vexed some vintners.

HB 373

Terri Sorantino and Jeffrey Cheskin, who opened Liquid Alchemy Beverages in Wilmington in September 2016, say the new law will help increase sales revenue at their location and assist them to appealing to a larger audience.

“We’re working on deciding how we’re going to roll it out right now,” said Mr. Cheskin. “We have a lot of good friends in the brewing and distilling world in Delaware and we’re excited to have the chance to offer their products here.

“The mead and cider we make is very flexible and we can incorporate cocktails and other type of drinks into our repertoire easily.”

The 4,000 square-foot cidery and meadery produces about 2,000 gallons of each product annually, but Ms. Sorantino says they’re looking to start serving other craft beverages produced in the state in the autumn.

“It’s a great opportunity to collaborate with the local breweries and distilleries. We’re thinking something along the lines of a Wednesday night Delaware craft cocktail night,” she said.

For a business like the Pizzadili Winery, which already holds a liquor license, the legislation might mean little, but smaller locations who may want to market themselves as event space will now be more flexible: Potential renters often desire the ability to serve their guests cocktails, wine and beer.

HB 165

According to Mr. Nunan, the hoped-for bill that would have allowed him to ship his wine to customers in the state fell short by just one vote.

“Nassau has been pushing for it for 12 years and we’ve been involved for five, but it didn’t quite make it — although this was the closest we’ve gotten,” he said.

Pizzadili’s winery on Peach Basket Road just north of Felton.

“It’s very frustrating because as a family farm winery and part of agri-tourism, people pass through here from all corners of the state. If someone from Greenville or down at the beach likes one of our small production wines and wants to have some shipped to them every once in awhile, we can’t do it.”

Mr. Nunan claims passing legislation has been an uphill battle because distributors are concerned that the law would “hurt their business model.”

“But, it’s allowed in 46 other states,” he said. “We need to catch up with the rest of the country. It hasn’t affected any other businesses in those states. In fact, statistics show that when direct shipping opens up, everyone does better — retailers and wholesalers as well as wineries.”

Ms. Sorantino and Mr. Cheskin, also vocal supporters of the bill, say that although it’d be hard to quantify how much it would have added to their bottom line, more ought to be done in the state to allow small businesses to stay competitive.

“It’s sad, because the state does have a few of these archaic laws that unfortunately favor some businesses over others,” said Mr. Cheskin. “We meet people down at the beach at various events, but the only way for them to get a few of our bottles is drive all the way up here and buy them at our location.

“We don’t know what sort of revenue we may be missing out on, but as a small business even a 5 percent increase to revenue can make a big difference.”

Undeterred, Mr. Nunan says he’s still confident the bill will eventually find its way into law.

“We’ll regroup and try again,” he said. “We’ll get it passed eventually. Each year we’ve gotten a little further down the field.”

Legislative hopes

The freedom to directly ship products to customers isn’t the only item on wineries’ wish lists. Most smaller wineries still lament the defeat of House Bill 228 in 2016 that would have allowed them to sell their products in a farmers’ market setting. The bill would have made a permit available to conduct tastings and sell craft beer, mead, distilled spirits and wine in sealed containers for off-premise consumption at retail prices at farmers markets or agricultural themed events.

“Other agricultural producers are allowed to sell their products at these markets, but we can’t,” said Mr. Nunan. “We’re already one of the most heavily taxed industries in the state, laws like these would help us grow our business.”

Again, Mr. Cheskin is unsure how much revenue a law such as HB 228 would have added, but he knows the added exposure would be valuable.

“There probably wouldn’t be a huge sales increase at a farmers market, but it would help us get our name out,” he said. “It’s expensive to advertise, and in these settings we’d be able to get into a public venue, meet with people and interact with the community more.”

Despite the state-imposed restrictions, the growing small businesses are making investments and tuning up for growth. Liquid Alchemy Beverages just increased its cider production capacity with two new 300-gallon tanks and plans add to their current setup of four 110-gallon mead tanks.

Mr. Nunan says Harvest Ridge Winery is in the midst of planning an extensive upgrade to their production facility with an eye toward increasing efficiency.

“We’ll likely do it in stages,” he said. “But it’d going to include a lot more automation. By the end of it, I think we’re going to have a facility that can rival pretty much anything on the east coast.”

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